DOES PHILIPS CURVE EXIST? EVIDENCE FROM ALL OVER THE WORLD

This paper provides evidences that the Philips curve exists in the world’s economy. The
Philips curve depicted a negative correlation between the rate of inflation and
unemployment rate. This dilemma has been a big problem faced by any government.
Inflation cannot be eliminated without raising unemployment, at least for some time and
moderate unemployment cannot be cut sharply without the risk of raising inflation. It was
empirically evidence that this curve exist in the short-run. Inflation cannot be reduced
without creating a recession. Using cross-section data on inflation rate and rate of
unemployment from 182countries all over the world: 49 countries in Asia, 52 countries in
Africa, 39 countries in Europe and 29 countries in America, this paper proved that there
was a negative correlation between the rate of inflation and unemployment rate. It means
that the Philipscurve do exists in economy, but the relationship between them was not
statistically significant.

ECONOMIC GROWTH, HUMAN DEVELOPMENT AND GLOBAL COMPETITIVENSS

This paper analysis direct and indirect impact of economic growth on global competitiveness,
with human development as moderator variable. Cross-section data on economic growth, human
development and global competitiveness indices were collected from 123 countries and
employed in a path analysis model. The results show that economic growth had positive and
significant direct impact on global competitiveness. Economic growth had negative and
significant direct impact on human development. Meanwhile, human development had positive
and significant direct impact on global competitiveness. Indirectly, through moderator variable
human development, economic growth had negative and significant impact on global
competitiveness. Implications of this finding were that economic growth no longer a single
important factor in development indicator for achieving global competitiveness. It is then
suggested that human development sustainably be promoted in order to make nations globally
competitive.